Manju Devi Dhanuka, Kolkata V. Addl C.I..T. - 55,kolkata, Kolkata

ITA 993/KOL/2013

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 3238 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 9 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-02-2016
• Appeal Filed By: Assessee
• Bench Allotted: C
• Assessment Year: 2004-2005
• Appeal Filed On: 29-04-2013
• Court: TRIBUNAL
• Department Lawyers: SUCHE TA BANDHOPADHYAY JCIT LD
• Keywords: Bonafide belief; Reasonable cause
• Section: 273B; 143(3)

Judgement Text

ITA NO. 993/KOL/2013-C-AM MANJU DEVI DHANUKA 1 IN THE INCOME TAX APPELLATE TRIBUNAL, C BENCH, KOLKATA BEFORE : SHRI MAHAVIR SINGH, JUDICIAL MEMBER, AND SHRI M. BALAGANESH, ACCOUNTANT MEMBER I.T.A NO. 993/KOL/2013 A.Y 2004-05 MANJU DEVI DHANUKA VS. ADDL. C.I.T, RANGE-55, KOLKATA PAN: ADOPD 8120P (APPELLANT) (RE SPONDENT) FOR THE APPELLANT: NONE APPEARED FOR THE RESPONDENT : SMT. SUCHE TA BANDHOPADHYAY, JCIT, LD.SR.DR DATE OF HEARING: 01-02-2016 DATE OF PRONOUNCEMENT: 05-02-2 016 ORDER SHRI M.BALAGANESH, AM THIS APPEAL OF THE ASSESSEE ARISES OUT OF THE ORDER OF THE LEARNED CIT(A), XXXVI, KOLKATA IN APPEAL NO. 58/CIT(A)-XXXVI/KOL/R . -55/09-10 DATED 22-03- 2013 FOR THE ASST YEAR 2005-06 AGAINST THE ORDER OF PENALTY LEVIED BY THE LEARNED AO U/S 272A(2)( C) OF THE INCOME TAX ACT, 1961 (HE REINAFTER REFERRED TO AS THE ACT). 2. THE ONLY ISSUE TO BE DECIDED IN THIS APPEAL IS AS TO WHETHER THE PENALTY U/S. 272A(2) ( C) OF THE ACT AMOUNTING TO RS. 64,900/- COULD BE LEVIED IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. THE BRIEF FACTS OF THIS ISSUE ARE THAT THE ASSES SEE IS AN UNDERGRADUATE LADY ENGAGED IN THE BUSINESS OF FILM PRODUCTION DURING T HE ASSESSMENT YEAR UNDER APPEAL. SHE HAD PRODUCED A FILM BY NAME ANNAY ATTACHAR, WHICH WAS COMPLETED ON 21-05- 2004. SHE ALSO PRODUCED THE FILM CHHETA. SHE HAD NO EXPERIENCE IN THE FILM LINE OF BUSINESS, WHICH COULD BE EVIDENT FROM COPY OF HER INCOME-TAX RETURN FILED FOR THE ITA NO. 993/KOL/2013-C-AM MANJU DEVI DHANUKA 2 EARLIER YEAR. THE ASSESSEE OUGHT TO HAVE FILED TH E FORM NO. 52A CONTAINING THE DETAILS OF EXPENDITURE INCURRED ON FILM PRODUCTION IN TERM S OF PROVISION OF SECTION 285B OF THE ACT WITH 30 DAYS FROM THE DATE OF COMPLETION OF FILM. THE ASSESSEE DUE TO HER IGNORANCE WITH REGARD TO THE SAME DID NOT FILE THE SAID STATUTORY FORM. HOWEVER, SHE HAD DULY FILED HER RETURN OF INCOME CONTAINING THE ENTIRE DETAILS OF EXPENSES INCURRED ON FILM PRODUCTION. IN THE ASSESSMENT ORDER PASSED U/S. 143(3) OF THE ACT, THE LD.AO HAD NOT MADE NO ADDITION/DISALLOWANCE TOWARDS EXPE NSES INCURRED BY THE ASSESSEE FOR FILM PRODUCTION. FOR NON SUBMISSION OF FORM NO. 52 A IN TERMS OF PROVISIONS OF SECTION 285B OF THE ACT, THE LD.AO IMPOSED PENALTY U/S. 272 A(2) ( C) OF THE ACT AMOUNTING TO RS. 64,900/-. ON 1 ST APPEAL, THIS ACTION OF THE LD.AO WAS CONFIRMED BY THE LD.CIT(A). AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US ON THE FOLLOWING GROUNDS :- (1) THAT UNDER THE FACTS & CIRCUMSTANCES OF THE CAS E L' D CIT (A) ERRED IN CONFIRMING THE PENALTY U/S. 272A(2)(C) FOR NON SUBMISSION OF RETURN U/S. 285B IGNORING SECTION 273B, THE REAS ONABLE CAUSE. (2) THAT THE CIT (A) ERRED IN CONFIRMING THE PENALT Y RS. 64,9001- IMPOSED U/S 272A(2)(C) DESPITE THAT WAS NO ALLEGAT ION THAT EXPENDITURE CLAIMED BY THE ASSESSEE IN THE RETURN E ITHER INFLATED OR FALSE. (3) THAT THE APPELLANT CRAVES TO ADD OR AMEND ANY G ROUNDS OF APPEAL ON OR BEFORE THE DATE OF HEARING. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS. WE FIND THA T THE ASSESSEE BEING AN UNDERGRADUATE LADY HAS STARTED NEW LINE OF BUSINES S OF FILM PRODUCTION DURING THE ASSESSMENT YEAR UNDER APPEAL. WE FURTHER FIND THA T SHE HAD NO INCOME FROM ACTIVITIES/BUSINESS OF FILM PRODUCTION IN THE EARLI ER YEARS. DURING THE PENALTY PROCEEDINGS SHE PLEADED THAT SHE WAS NOT AWARE AB OUT THE SUBMISSION OF FORM NO.52A WITHIN 30 DAYS FROM THE DATE OF COMPLETION OF FILM AS CONTEMPLATED U/S. 285B OF THE ACT. WE FIND FROM THE ASSESSMENT ORDER THAT NO DISA LLOWANCE/ADDITION OF EXPENDITURE TOWARDS COST OF FILM PRODUCTION WAS MADE IN THE ASS ESSMENT PROCEEDINGS BY THE LD. AO. THE ENTIRE EXPENDITURE INCURRED TOWARDS FILM PR ODUCTION HAS NOT BEEN DISPUTED BY ITA NO. 993/KOL/2013-C-AM MANJU DEVI DHANUKA 3 THE LD. AO IN ANY MANNER WHATSOEVER. HENCE, NO PREJ UDICE IS CAUSED TO THE REVENUE BY NON SUBMISSION OF FORM NO.52A WITHIN THE PRESCRIB ED STATUTORY TIME. HENCE, WE HOLD THAT IT ONLY AMOUNTS TO TECHNICAL VENIAL BREACH AND THAT THE ASSESSEE HAD TRIED TO EXPLAIN THE REASONABLE CAUSE CONTEMPLATED U/S. 273B R.W.S 272A(2) ( C ) OF THE ACT BY STATING THAT SHE HAS STARTED THE FILM PRODUCTI ON BUSINESS DURING THE ASSESSMENT YEAR UNDER APPEAL. SHE WAS COMPLETELY IGNORANT OF THE S TATUTORY PROVISION REGARDING NON SUBMISSION FOR FORM NO. 52A. WE HOLD THAT THIS EXPL ANATION IS TRULY BONAFIDE AND REASONABLE CAUSE IN TERMS OF PROVISIONS OF SECTION 273B R.W.S 272A(2)( C ) HAS BEEN DULY ADDUCED BY THE ASSESSEE. WE HOLD THAT REASO NABLE CAUSE CAN BE REASONABLY SAID TO BE A CAUSE WHICH PREVENTS A MAN OF ORDINAR Y PRUDENCE AND AVERAGE INTELLIGENCE ACTING UNDER NORMAL CIRCUMSTANCES. WE PLACE RELIANCE ON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF HINDUSTAN STEEL LTD VS. STATE OF ORISSA REPORTED IN (1972) 83 ITR 26(SC), WHEREIN IT HAS BE EN HELD AS UNDER:- 'AN ORDER IMPOSING PENALTY FOR FAILURE TO CARRY OUT A STATUTORY OBLIGATION IS THE RESULT OF A QUASI-CRIMINAL PROCEEDING AND PENAL TY WILL NOT ORDINARILY BE IMPOSED UNLESS THE PARTY OBLIGED EITHER ACTED DELIB ERATELY IN DEFIANCE OF LAW OR WAS GUILTY OF CONDUCT CONTUMACIOUS OR DISHONEST OR ACTED IN CONSCIOUS DISREGARD OF ITS OBLIGATION. PENALTY WILL NOT ALSO BE IMPOSED MERELY BECAUSE IT IS LAWFUL TO DO SO. WHETHER PENALTY SHOULD BE IM POSED FOR FAILURE TO PERFORM A STATUTORY OBLIGATION IS A MATTER OF DISCR ETION OF THE AUTHORITY TO BE EXERCISED JUDICIALLY AND ON A CONSIDERATION OF ALL THE RELEVANT CIRCUMSTANCES. EVEN IF A MINIMUM PENALTY IS PRESCRIBED, THE AUTHOR ITY COMPETENT TO IMPOSE THE PENALTY WILL BE JUSTIFIED IN REFUSING TO IMPOSE PENALTY, WHEN THERE IS A TECHNICAL OR VENIAL BREACH OF THE PROVISIONS OF THE ACT OR WHERE THE BREACH FLOWS FROM A BONAFIDE BELIEF THAT THE OFFENDER IS N OT LIABLE TO ACT IN THE MANNER PRESCRIBED BY THE STATUTE.' WE FIND THAT THE CASE LAW AS LAID DOWN BY THE HONB LE SUPREME COURT IN THE AFORESAID CASE IS APPLICABLE LOOKING TO THE PROVIS IONS OF SECTION 272A(2) ( C ) R.W.S 273B OF THE ACT. WE ALSO FIND THAT THERE IS NO LOS S TO THE REVENUE THAT COULD BE ATTRIBUTED IN THE FACTS OF THE CASE AND THE INTERE ST OF THE REVENUE IS NOT JEOPARDIZED. THE ASSESSEE HAD COMMITTED ONLY TECHNICAL VENIAL BREACH WHICH ITSELF SATISFIED THE ITA NO. 993/KOL/2013-C-AM MANJU DEVI DHANUKA 4 TEST OF REASONABLE CAUSE U/S. 273B OF THE ACT. HEN CE, WE HAVE NO HESITATION IN CANCELLING THE PENALTY LEVIED U/S. 272A(2)(C ) OF T HE ACT IN THE HANDS OF THE ASSESSEE. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED AS STATED ABOVE. THIS ORDER IS PRONOUNCED IN OPEN COURT ON 05 -0 2-2016 1.. THE APPELLANT: SMT. MANJU DEVI DHANUKA P.K HIM MATSINGHKA AA-4, SALT LAKE, KOL-64. 2 THE RESPONDENT- ADDL. CIT-55, 54/1 RAFI AHMED K IDWAI ROAD, KOL-16. 3 /THE CIT, 4.THE CIT(A ) 5. DR, KOLKATA BENCH 6. GUARD FILE. TRUE COPY, BY ORDER, ASSTT REGISTRAR **PRADIP SPS SD/- ( MAHAVIR SINGH, JUDICIAL MEMBER ) SD/- (M. BALAGANESH, ACCOUNTANT MEMBER) DATE: DATE 05 -02-2016 COPY OF THE ORDER FORWARDED TO:-